Speculators shift to net long position on yen amid rate-hike expectations
Futures data show traders moved to a net long stance on the yen for the week ending September 8, reversing a large net short position from the prior week.
According to CFTC futures data, speculators turned net long on the yen in the week to September 8, holding 10,796 long contracts after a net short of 92,227 the previous week. The reversal signals increased confidence that the Bank of Japan will tighten monetary policy faster than markets expected and that Japanese investors could repatriate capital. The yen’s rally pushed the dollar-yen rate to 152.89, the highest since mid-February.
The currency’s decline over the past year had been linked to the election of fiscal-dove Sanae Takaichi as prime minister and perceptions that the BOJ lagged behind in tightening. After falling to a four-decade low of 163.99 per dollar in July, the yen received coordinated intervention from Tokyo and Washington.
Why it matters
The move signals a potential turnaround for Japan's currency and could affect global forex markets.
In this story
